Podcast Episode 131: suing Yahoo! Executives…and winning

In this week’s episode (#131): a shareholder lawsuit targeting Yahoo! executives was settled quietly. But it could have big implications for the C-Suite at breached firms. Also: as the US pursues criminal charges against Huawei for corporate espionage, we look at one of the federal government’s most potent tools to stop the transfer of sensitive IP: the Committee on Foreign Investment in the US.

That case, a so-called “derivative lawsuit,” was filed on behalf of Yahoo! shareholders against the company’s executives, including former CEO Marissa Mayer. The suit alleged that they breached their fiduciary duties in the reckless handling of customer data. The result: a $29 million settlement, including $11 million in attorneys’ fees. The balance, some $18 million will go to Yahoo or, as it is now known, Altaba, part of Verizon. (PDF)

Craig Newman is a partner and head of the data privacy practice at the New York law firm of Patterson, Belknap, Web and Tyler

While that might not sound like much, our first guest on the podcast this week notes that derivative suits are notoriously hard to win and that, even when they are won, any cash settlement in a derivative suit beyond attorneys fees is exceedingly rare.

What does the success of the suit mean for the heads of other companies that are the victims of sophisticated hacks? Craig Newman, the head of the data privacy practice at the New York law firm of Patterson, Belknap, Web and Tyler dropped in to the Security Ledger studios to talk about the derivative suit against Marissa Mayer and the other Yahoo! executives and its ramifications.

Luke Tenery is a Senior Managing Director at Ankura and head of the firm’s national cybersecurity practice

The move is just the latest in a series of actions the Trump Administration has taken to curb the influence of foreign technology firms deemed a threat to US security. Among the other targets: Russian security software firm, Kaspersky Lab. (Check out this Security Ledger podcast to hear more discussion of the U.S. Government’s case against Kaspersky.)

How is the evolution of cyber risk effecting CFIUS reviews? To talk about that, we invited Luke Tenery, the Senior Managing Director and head of the cyber security practice at the firm Ankura in to the security ledger studios to talk about it.

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Author: PaulI'm an experienced writer, reporter and industry analyst with a decade of experience covering IT security, cyber security and hacking, and a fascination with the fast-emerging "Internet of Things."